Brian Williams on tonight’s Nightly News brought us the report above.
I find it very disturbing that no one on the report, not even the supposed financial planner, commented on the fact that an elderly person, especially one that’s already drawing from a pension, IRA, or other retirement accounts, has no business having any of that money invested in the stock market.
Any good financial advisor would advise that as you age, your investments in your retirement accounts and other holdings should become more and more conservative. In other words, as you age and near retirement, your portfolio should shift from a majority of stocks to a majority of bonds. The reasoning behind this is exactly what the Nightly News report hinted at. When you are young and the stock market goes down and you lose 30% of the value of your portfolio, you have a lifetime to make up for that loss. When you’re elderly, you simply do not have the luxury of time to regain the value of your portfolio.
I am not a financial advisor nor am I a financial planner. But I am an estate planner and as such, it is my responsibility to advise elders issues with money. Whenever I meet a new client for estate planning or elder planning counseling, I get a picture of their financial health and life goals. That picture includes all their assets and holdings including what’s in their investment portfolios. If I saw that an elderly person’s portfolio was subject to the highs and lows of the stock market, I would advise that individual to immediately 1. see their financial advisor and change their portfolio or 2. fire their financial advisor and get one that knows what they’re doing.
The story above should never happen to anyone. Unless those people are handling their own investment portfolio, it is a travesty that their advisor would leave those in need of their money the most, exposed to the fickleness of the market.
